IVRCL - Update - IVRCL among 37 in race for developing eight airports in AP

Reliance Industries Ltd, and an Anil Dhirubhai Ambani Group company are among the 37 who have submitted expressions of interest (EoI) to develop eight regional airports in Andhra Pradesh, a senior official with Infrastructure Corp of Andhra Pradesh said.

Infrastructure Corp of Andhra Pradesh is the nodal agency for airports development in the state. Technical and financial bidding for the projects are expected to be completed in 3-4 months and the project would be awarded by September, he said.

The state government recently invited EoIs from private companies to develop these airports on a public-private partnership basis.

Other major companies that have evinced interest in the projects are Maytas Infra, Unitech, IVRCL, Lanco Infratech, GMR Infra, and London-based Caparo group promoted by Swaraj Paul. ADAG has submitted its documents through Reliance Airport Developers Pvt Ltd, the official said.

The new airports are expected to come up in Bobbili, Nellore, Tadepalligudem, Ongole, Kurnool, Kothagudem, Nizamabad, and Ramagundam.

“Major infrastructure developers in the country have submitted their EoIs and submitted pre-qualification request papers,” the official said.

The state government will allocate land as its share of the project cost and the rest will have to be borne by the developers, the official said.

“A total of 87 companies responded to our invitation for pre-qualification process. Out of them, 37 companies have been qualified for the bidding,” the official added.

Link to the article: http://www.business-standard.com/common/news_article.php?leftnm=10&bKeyFlag=BO&autono=315241

Article - Budget 2008 has no surprises for the Infrastructure sector.

Opening the gates for irrigation

Budget 2008 has no surprises for the Infrastructure sector. While the irrigation and road segments will continue to receive favours, not many incentives were dispensed to the power sector.

Similarly, no special support was evident to speed up other infrastructure segments such as ports and airports. The sector as a whole continues to receive healthy outlays with a 27 per cent increase in allocation to the Bharat Nirman iniative, at Rs 31,280 crore.

Thrust on irrigation

Among the various infrastructure segments, irrigation tops the chart in terms of highest increase in allocation. The Accelerated Irrigation Benefit Programme has received an 82 per cent increase in outlay to Rs 20,000 crore.

While companies such as IVRCL Infrastructures & Projects, Hindustan Construction and Nagarjuna Construction are some of the prime beneficiaries, Jain Irrigation Systems, KSB Pumps and Kirloskar Brothers may also reap benefits as a result of order flow from irrigation projects. Pipe manufacturers such as Maharashtra Seamless and PSL could also benefit from the increased outlay.

The establishment of the Irrigation and Water Resources Finance Corporation reflects the Government’s intention to provide sustainable support to the irrigation sector.

Similarly, increased outlay for the Jawaharlal Nehru National Urban Renewal Mission, as well as development in sanitation and drinking water, will see mid and small-sized companies such as Simplex Infrastructures and JMC Projects participating in more urban projects.

In the road segment, there has been a 20 per cent increase in outlay under the National Highways Development programme.

While the allocation is along the lines of earlier Budgets, delays in order flows last year due to finalisation of the Model Concession agreement for roads may have led to an overshoot in cost.

The present increase in outlay does not appear to have factored in the same. The current year, however, is more favourable for larger road players as most of the PhaseV projects are large and require a BOT model.

Cost neutral: On the cost side, while power projects qualifying for ‘project imports’ would see a nominal reduction in customs duty from 7.5 per cent to 5 per cent, the Budget has withdrawn the 4 per cent additional customs duty exemption that was earlier available for power generation, transmission and distribution projects. This is not applicable for mega power projects.

This may not dent margins steeply as rupee appreciation has provided comfort on import costs. Cement, a key raw material for construction, is also unlikely to receive much respite, with the excise duty on bulk cement increased.

However, cement costs might remain neutral as construction companies mostly go for packaged cement rather than bulk cement.

Boost for funding

The Budget’s effort to encourage the growth of corporate debt market by eliminating tax deduction at source on instruments that are in demat form and are listed in the stock exchanges is a welcome move for infrastructure and power companies as debt instruments are a popular source of financing in their projects.

Link to the article: http://www.thehindubusinessline.com/2008/03/01/stories/2008030152471400.htm

Article - Budget sops give Pharma sector a shot in the arm

The pharma sector got a shot in the arm, as Finance Minister P Chidambaram allocated Rs 16534 crore for the health sector for FY09 in Budget 2008. He has also hiked the allocation to the National Rural Health Mission by 15% and has announced a health cover of Rs 30,000 for every worker in the BPL category.

Malvinder Singh, CEO at Ranbaxy Laboratories says that, "This is a very positive Budget for healthcare, hospitals and pharma companies. The weighted deduction of 125% to R&D will add back significantly to profits. Custom duties for lifesaving drugs coming down, excise duties coming down to nil for lifesaving drugs; for HIV AIDS products excise duties coming down is a very strong message for the industry, for the consumers. It's extremely positive - could not have asked for anything else. It is good for the industry, for the consumers."

Kiran Mazumdar-Shaw, CMD at Biocon Limited feels that the healthcare sector will be well satisfied with Budget 2008.

She says, "The healthcare sector is a major beneficiary of Budget 2008. India's emerging role as being the preferred destination for drug development coupled with an increasing need to bring down drug prices have been the key factors in this year's budget SOPs. The sops have come as a pleasant but welcome surprise and have more than met industry expectations."

Weighted average tax deduction on outsourced R& D, which sends a strong signal of the potential that discovery research holds for the Indian Pharma and Biotech industry, she added.

Links to the articles:

http://www.moneycontrol.com/india/news/budget-news/budget-sops-give-pharma-sectorshotthe-arm/18/05/328649

http://money.cnn.com/news/newsfeeds/articles/newstex/AFX-0013-23391339.htm

Wockhardt - Update - Buy Wockhardt, target Rs 455: Karvy

Karvy Stock Broking firm has maintained buy rating on Wockhardt with target price of Rs 455 in its February 28, 2008 research report. "The net revenues in Q4CY07 grew by 44.8% y-o-y to Rs7,620 million against our estimates at Rs7,357 million. This is mainly on the back of strong performance witnessed from the export markets (with 60% growth) driven primarily from the formulation exports (with 68.2% growth) from the US & European markets. For CY07, the net sales went up by 53.5% to Rs26.5 billion on back of export revenue growth of 77.8% which has been driven by formulation exports with a 91.8% growth to Rs17,457 million. Wockhardt plans to grow by 32-35 % in CY 2008. We have assumed 33 % growth in CY 2008 and incorporated R & D expenses of Rs 600 million and Rs 500 million in CY 2008 and CY 2009."

"We believe the company is on a strong growth path and would start amortization of R & D expenses which would be reflected in CY 2008E to the tune of Rs 150 million and Rs 400 million in CY 2009E. We have adjusted R & D expenses which have been capitalised to the tune of Rs 700 million in CY 2008 E and Rs 300 million in CY 2009E. Currently the stock is quoting at 12x CY 2007. We maintain our BUY rating on the stock with a price target of Rs 455 based on 12x CY 2008E (EPS Rs37.9)" says karvy research report.


Link to the article: http://www.moneycontrol.com/india/news/recommendations/buy-wockhardt,-target-rs-455:-karvy/328295

Biocon - Update - Biocon eyes more buys to boost growth

BANGALORE: India's top biotechnology firm, Biocon Ltd, is looking at overseas acquisitions for about $10 million to boost its sales globally and gain access to innovative drugs, its chairman said on Wednesday. Biocon, which makes insulin, cholesterol-lowering statins and other branded drugs, had earlier this month agreed to buy 70 percent of German marketing firm AxiCorp GmbH for 30 million euros ($45 million) to boost distribution and marketing of pharmaceuticals in Europe.

"I am looking at smaller companies where even if I have to invest and get a majority or controlling stake it won't cost me more than $10 million or thereabouts," Kiran Mazumdar-Shaw told Reuters in an interview. The targets are marketing firms in Europe and research-focused biotechnology companies in the United States, Australia and New Zealand, she said. Last month, Biocon said its quarterly profit rose more than five times after one-off gains from sale of its enzymes unit to Denmark's Novozymes, and forecast more growth despite recession concerns in its key U.S. market.

Bangalore-based Biocon has been looking to acquire firms to boost its marketing and drug discovery muscles, after it sold off its enzymes business in July last year for $115 million. "For Europe, it's a totally marketing strategy that we are looking at," said Mazumdar-Shaw, who set up Biocon in her garage in Bangalore in 1978. "At the same time we are also looking at acquisition opportunities in say innovation."

She said a plan to launch an initial public offer of its contract research unit, Syngene, was on track by the end of the fiscal year that begins in April. The company has not yet finalised details of the offer. A 12 percent drop in the stock market this year, caused by a global equities rout, knocked out a few IPOs in the Indian market in recent weeks, including a $1.6 billion issue from Emaar MGF Land, the Indian unit of Dubai's Emaar Properties.

ORAL INSULIN

Clinical trials for Biocon's innovative oral insulin is making good progress and the company should be able to sign a licensing deal to launch the product in global markets early next year, Mazumdar-Shaw said. Brokerage ICICI Securities said in a Feb. 19 research report that Biocon might generate "windfall revenue" through the licensing of oral insulin. It has assumed the deal size to be between $100 million and $300 million.

"We believe we are actually in a very good position because you can see that number of recent diabetic drugs have had safety concerns associated with them," the Biocon chief said. "That's why we believe an oral insulin could have a very, very interesting opportunity in managing diabetes very effectively with no safety concerns." Biocon sees prices of statins, which contributes a quarter of its revenue, stabilising on waning competition. The United States and Europe are its main markets for the statins used to lower cholesterol levels.

Investment on research and development activities in the year to March 2009 will be 15-20 percent higher than this year's spending of over Rs 1 billion, said Mazumdar-Shaw, who earned a master's brewing degree in Australia before pioneering Biocon. Shares in Biocon, which has a market value of more than $1 billion, ended 0.3 percent higher at Rs 441.05 on Wednesday in a Mumbai market that edged up 0.1 percent. The stock is down about 24 percent so far this year.

Link to the article: http://economictimes.indiatimes.com/News/Biocon_eyes_more_buys_to_boost_growth/articleshow/2820122.cms

Wockhardt - Update - Morgan Stanley

Morgan Stanley has reiterated overweight rating on Wockhardt; with a target of Rs 460

Wockhardt - Update - Buy Wockhardt, tgt Rs 552: Sharekhan

Sharekhan research has maintained buy rating on Wockhardt with target price of Rs 552 in its February 25, 2008 research report. "Wockhardt's Q4CY2007 and CY2007 performance have been marginally above our expectations, with the topline growth of 44.8% and 53.5% in Q4CY2007 and CY2007 respectively and the profit growth of 22.7% and 27.9% in Q4CY2007 and CY2007 respectively. The robust growth was largely driven by the consolidation of Negma and Morton Grove acquisitions made during the year. On a like-to-like basis, the organic growth stood at 6% during Q4CY2007 and at 13% during CY2007. With three major acquisitions in the USA, France and Ireland over the past two years, Wockhardt has created a global footprint for itself and has become the largest Indian company in Europe."

"The company aims to consolidate its acquisitions and extract value from them over the next two years. Wockhardt's ability to create value from acquisitions is evident in the turnaround and operational improvements effected in Dumex, Pinewood and Morton Grove. Wockhardt's performance in Q4CY2007 and CY2007 has been marginally ahead of our expectations. Even though the super normal growth of 53% has been largely driven by the consolidation of Negma and Morton Grove, Wockhardt's base business also seems to be performing reasonably well."

" At the current market price of Rs 344, the stock is available at 8.7x its CY2008E and 7.5x its CY2009E earnings on a fully diluted basis. We believe such low valuations are not justified in light of the strong value creation potential from acquisitions and the potential upsides from the biopharmaceutical opportunity, inspite of the limited organic growth potential. We maintain our Buy recommendation on the stock with a price target of Rs 552." says Sharekhan research report.

Link to the article: http://www.moneycontrol.com/india/news/recommendations/buy-wockhardt,-tgt-rs-552:-sharekhan/328203

Cranes Software - Update - Stks to get into post railway Budget

Your third pick, Cranes Software, give us an idea of how much of an up tick investors could look at in this stock if they were to put their money in?

A: This is a very niche area company, it’s a software product company and it operates in an area of scientific software products, so you have typically scientific research organizations, which use their products. It’s more of a retail product and they are also going into enterprise products and they have acquired a lot of companies in the last few years. They have been able to ramp up successfully sales of those products, so that is a positive factor that execution has been pretty and also their margins are among the highest in the industry at about 50%. We have a target of about Rs 170 on that stock right now.

Link to the article: http://www.moneycontrol.com/india/news/market-outlook/stks-to-get-into-post-railway-budget/328224

Jaiprakash - Update - Invest in Jaiprakash Associates: Chakrabarty

Chakrabarty told CNBC-TV18, "In Jaiprakash Associates the core business, which the EPC and cement, according to our calculation that itself is Rs 215-220. Rs 500 stock has become Rs 250 because of that ambiguity that whether JP Infratech has 100% owned by JP Associates or it is 55% or 45% is by the promoter. That ambiguity though the promoter has cleared but once there is a confusion, that confusion doesn’t go. So if anybody is an investor and wants to invest in the stock, not as a trading purpose, this is a good stock to invest at this price.

Link to the article: http://www.moneycontrol.com/india/news/stocks-views/invest-in-jaiprakash-associates:-chakrabarty/328147

Jaiprakash - Update - Most brokerages putting a buy call on JP Associates

It broadly looks like a long-term call for JP Associates. The stock itself is been in a controversy for the last one month or so. The stock has corrected 50% from its peak. Now after the 50% correction, a couple of foreign brokerage have come out with a buy report from both, CLSA and Merrill Lynch. Both are of the view that the stock has corrected enough and it’s come into a comfort zone where they can put in a buy. There are strong triggers for the stock to go up and recover the lost grounds over the next couple of months, they are basically putting a buy on this stock.

CLSA has come out with a report saying that it’s a strong buy according to them. They’ve mentioned couple of triggers for which the stock may go up from current levels. One is the value unlocking which will happen in the power business, plus the kind of money they will recover from selling their assets close to the Taj corridor. So these are the two basic triggers, according to CLSA, for which they have put in a buy on the stock.

Merrill Lynch has also come out with a strong buy. In fact they have reinitiated a buy on the stock post the 50% correction. According to them too there is a potential 83% upside on the stock from current levels and even to them the rational is very clear.

Though all these controversies were created after the Merrill conference wherein the management was not clear about the holding structure, now that is clarified by the management, not only to us but also to the broking community. It’s very clear now that JP Infratech, which will be doing business for Taj Corridor and Ganga Express Highway, will be 100% part of JP Associates. It will not be sold to any other company or to the promoter group company.

That’s a big clarification which the management has already come on air and spoken to us about the same. But that looks like it’s a big trigger for them and also the value unlocking of the power business which the management has talked about. These are the two main triggers for both, CLSA and Merrill Lynch. They feel, the stock has corrected enough and there is a good potential for the stock to go up from current levels.


Link to the article: http://www.moneycontrol.com/india/news/business/most-brokerages-putting-a-buy-call-on-jp-associates/328016

Jaiprakash - Update - I- venture, JP Infra PE deal is off

What could have been one of the largest private equity deals in India has come unstuck. ICICI Venture and Jaypee Infratech have terminated negotiations for the PE player buying close to 10-15% stake for $800 million in the infrastructure company, which is developing project worth Rs 1 lakh crore. The deal could have given Jaypee Infratech a valuation in excess of Rs 30,000 crore.

“ICICI Venture is not investing in Jaypee Infratech. We were looking at getting a strategic investor in the firm, but have put our plan on hold for now,” Jaiprakash Associates (JAL) executive chairman Manoj Gaur told ET.

Jaypee Infratech is a wholly-owned subsidiary of JAL and the original plan was for investors to acquire 44% stake in the company through allotment of new shares. But now JAL plans to invest up to Rs 440 crore to acquire 44 crore equity shares of Rs 10 each at par, in one or more tranches in Jaypee Infratech.

The additional shares JAL is subscribing were originally meant for strategic investors, Mr Gaur said, adding that “since the strategic investment has been put on hold, JAL has initiated action to subscribe to these shares.”

It couldn’t be ascertained as to why the deal didn’t work out. But sources said the deal may have fallen through because of several reasons, including valuation and representation on board.

It couldn’t be independently confirmed how much stake ICICI Venture was seeking in Jaypee Infratech, but Mr Gaur had told a news agency two months ago that the stake could be in single digit, although some reports suggested that it could be above 10%.

JAL had floated Jaypee Infratech last year to execute the 165-km-long Taj Expressway project linking Noida with Agra. Mr Gaur estimates this project to be worth Rs 1 lakh crore. Under the project, Jaypee Infratech will also develop close to 35 crore sq ft of real estate in the five proposed townships along the expressway.

The Taj Expressway project, which was awarded to Jaypee group in 2003 by the then Mayawati government of Uttar Pradesh, was delayed due to a political controversy. The project, however, has now been given a go-ahead by a probe panel and may be completed by 2010. With Mayawati back in Lucknow as chief minister, the project is unlikely to see any further delay.

Had the ICICI Venture-Jaypee Infratech deal been completed, it could have been the biggest deal by ICICI Venture in India. At least two PE deals have been reportedly called off in the past two months. Leading international buyout firm Blackstone first scaled down and later called off its agreement to buy 26% stake in Hyderabad-based Ushodaya Enterprises, promoters of Eenadu newspapers and television channels, for $275 million.

Similarly, Future group’s PE fund Indivision cancelled its deal to buy 4.9% stake for Rs 250 crore in media house Zee TV’s DTH venture Dish TV. The deal was reportedly called off following the market meltdown that saw Dish TV share prices sliding in the open market much below the agreed purchase price between the two parties.

Link to the article: http://economictimes.indiatimes.com/News/News_By_Industry/Banking_Finance_/I-_venture_JP_Infra_PE_deal_is_off/articleshow/2814567.cms

Jaiprakash - Update - Hold Jaiprakash Associates for long term: Bhambwani

Technical Analyst, Vijay Bhambwani is of the view that one can hold Jaiprakash Associates for long term.

Bhambwani told CNBC-TV18, "In Jaiprakash Associates a sustained trade below Rs 220 will significantly increase the probability of a fresh down side, which would take it below the Rs 200 mark and keep it there. On the upsides, a stiff resistance will be encountered by the stock, the closer it gets to Rs 300 or even Rs 325 levels, which seems a little difficult to achieve looking at the way the market is behaving."

He further added, "In the short to medium term, the up side potential on the stock is limited. Although a steep decline from here also may not happen in the short term but it could take a long time for the stock to actually come up and scale its highs. So only if you have made up your mind to remain with the stock as a medium to long term investor, then you should hold on, for momentum players or swing traders,it’s a sell."

Link to the article: http://www.moneycontrol.com/india/news/stocks-views/hold-jaiprakash-associates-for-long-term-bhambwani/12/58/327725

Jaiprakash - Update - Stay with Jaiprakash Associates: Joshi

Sharmila Joshi of Prabhudas Lilladher is of the view that one can stay invested in Jaiprakash Associates.

Joshi told CNBC-TV18, "If one is a long term investor, Jaiprakash Associates is the stock in which one can stay invested in. We did see a lot of volatility on the stock since the last 2-3 week. Looking at the kind of contracts that they have, and the lines of business that they are in, it’s a stock that one can hold at the current price. But because of the recent sell off that we have seen, especially from the F&O side as well, it may take time to recover, given also the market conditions. What’s really driving the stock down doesn’t seem to be like truly fundamental reasons but a whole host of other things happening around it."

Link to article: http://www.moneycontrol.com/india/news/stocks-views/stayjaiprakash-associates-joshi/18/20/327757

Jaiprakash - Update - Buy Jaiprakash Associates: Vijay

Vijay told CNBC-TV18, "Jaiprakash Associatess is one of the best buys at this point in time. It has corrected viciously for no apparent reason and the problem is that it is an over owned stock. I think everybody got very excited about its business model and kept buying it. So there has been lot of institutional selling and the general weakness in the markets also contributed. But at this level and the type of speed with which the projects are getting implemented it is a pretty safe play."

Link to article: http://www.moneycontrol.com/india/news/stocks-views/buy-jaiprakash-associates-vijay/18/00/327689

Alok Industries - Update - Alok Ind eyes Rs 1,100 cr export turnover in FY08

Achieves earnings target despite rupee appreciation.

Alok Industries, the Rs 1,824-crore textile company, plans to ramp up its export earnings. It is targetting revenues of Rs 1,100 crore from the segment this financial year. According to a senior manager, it is eyeing Rs 1,500 crore in FY09.

The company has already achieved its export turnover worth Rs 640.4 crore out of its total turnover of Rs 1,434.4 crore in the first nine months of this financial year, a rise of 66.2 per cent on a year-on-year (y-o-y) basis.

The official, however, did not answer questions pertaining to weakening demand from the key US market and its potential impact on achieving its exports target over the next few quarters.

Despite 11-12 per cent y-o-y appreciation of the rupee, the company has shown a strong growth in its export turnover in the first nine months of FY08.

According to Dilip Jiwrajka, managing director, Alok Industries, "We were able to withstand the impact of a strengthening rupee via expanding sales of higher value products across our product segment, that includes home furnishings, men and women's clothing."

In addition, the company's growth in sales in the European market was derived from their earlier Czech-based acquisition Mileta, which provided them manufacturing and marketing capabilities in the region.

The company's other key export markets are in Latin America. In December 2007 quarter, its operating profit grew 22.3 per cent y-o-y to Rs 134.8 crore, while its net sales rose 14.75 per cent to Rs 550.78 crore.

Meanwhile, in the domestic market, Alok Industries is ramping up its retail network from 20 stores to 125 stores by the end of December 2008.

Its retail store network is branded as H&A. Also, Alok Industries is expecting to bring on stream its terry towel expansion project in Vapi by May 2008, which involves a capital expenditure of Rs 100 crore.

Link to the article: http://www.business-standard.com/common/news_article.php?autono=314886&leftnm=1&subLeft=0&chkFlg=

Wockhardt - Update - Buy Wockhardt; target of Rs 630: Angel

Angel Broking has recommended buy rating on Wockhardt with a target of Rs 630 in its February 21, 2008 report. “Wockhardt posted consolidated Sales and Profits of Rs 762 crore and Rs 106 crore in 4QCY2007 registering a growth of 45% and 21%, respectively. With this, for CY2007, Wockhardt posted consolidated Sales and Profits of Rs 2653 crore and Rs 386 crore registering a growth of 53.4% and 59.8%, respectively. A combination of the company’s organic and in-organic initiatives was mainly responsible for the growth in CY2007. During CY2007, the European business clocked an impressive growth of 97% to Rs 1410 crore (Rs 715 crore). Apart from Europe, US also posted robust growth of 64%.”
“At the CMP, the stock is trading at 8.5x CY2008E and 7.4x CY2009E FDEPS, which is at a significant discount to its peers. A substantial part of the discount is on account of the high competitive pressures in the Generic space and dependence of the company on its M&A strategy to scale up its Generic business. The stock is quoting at 4.5x EV/EBDITA CY2009E, which is at a significant discount to its peers, which are trading at 6.5x EV/EBDITA. We believe the stock is available at attractive valuations even after discounting the concerns. Hence, we maintain a Buy on the stock, with an 18-month Target Price of Rs 630," according to Angel Broking research report.


Link to the article: http://www.moneycontrol.com/india/news/recommendations/buy-wockhardt;-target-of-rs-630:-angel/327553

Jaiprakash - Update - Bullish on JP Associates:Emkay Stock Brokers

In the near-term, he said, there is a immense value to be unlocked in JP Associates. “It has got a 7 million tonne cement division. They are the sixth largest, trying to become third largest by expanding production. They plan to reach 30 million by 2011 but they will reach 80 million by just 2009. “ The company has a number of hydropower projects under construction, he said. It also has a presence in real estate, which is its main core business, he added.

Q: What is your own sense on JP Associates with all that you have heard in terms of the Taj Expressway with what the management has been saying and of course the valuations at this point of time, would you buy it or are there still some concerns on this stock?

A: One line answer will be I will buy but market has gone down from 21,000 to even as low as 15,500 and I think any small confusion or a misinterpretation has been taken as a battling ground for the market players.

If you look at JP, there is another way of looking at the valuations. I think people are now looking at near-term valuations and they are not considering the long-term valuations. So JP has got a cement division, which is 7 million tonne. They are the sixth largest, trying to become third largest by getting into expansion and they will reach 30 million by 2011, they will reach 80 million by just 2009. So I think there is a clear-cut track record this company has got. We assigned a value of Rs 130 for their cement business.

If you look at the hydropower projects, EPC contracts have 50% share and if you look at their own power projects, they have 700 megawatt of power, 300 from Baspa-II and 400 from Vishnuprayag. We are valuing the 700-megawatt at Rs 44, now there is also 1000-megawatt power for which they have already done the financial closure on September 2006. This project is going to get completed by 2011.

Looking at the far end kind of a valuation, I am just stripping it off, I am not taking any value for this 1000-megawatt. They have a very good EPC contract and order book of Rs 117 billion and they have 50% market share in hydro. I assigned a value of Rs 41 for the EPC business.

Coming back to the main core, the real estate where JP Green is a very clear cut 50% of their-stocks have been already sold where we have assigned a value of 14 and I would say there is a confusion in the mind of the investor about Taj Expressway and we just take Taj Expressway at nil value. Even if I take Taj Expressway at nil value and any power project, which is not operational the value comes Rs 229, which is just Rs 30 below the current market price.

Even if you take the worst scenario by saying that 55% is the share of JP in JP Infratech then at least on Rs 162 of real estate value that I am assigning Rs 89 comes as a part of 55% share.

So even if you add in the worst scenario, which is 55%, the total value comes to Rs 318. I think one of your analysts is saying that there is 99% share in JP Infra, I think it anyway removes all kind of confusions.

So even if you look at from the near-term there is a immense value. Even if you take 55% share of JP even then the value comes to Rs 318. I am not taking 2,100 megawatt of power which they have already got for which they are working in the next six months. I am not taking anything, which is even close for financial closer. I think the strip down value itself is Rs 229 itself.


Link to the article: http://www.moneycontrol.com/india/news/market-outlook/bullish-on-jp-associates,-gmr-infra:-emkay-stock-brokers/327555

Jaiprakash - Update - Buy Jaiprakash Associates: Mehta

Mehta told CNBC-TV18, "JP Associates looks extremely attractive at this point of time. The correction has been over done because of technical considerations and sell offs by few large institutions as well as a melt down in futures market. Hydro power is the next growth engine for this country and we are all talking about renewable energy, and there are handful of 4-5 companies in India, which can execute hydro power and JP Associates is one of them. That business has got amongst the highest operating profit margins within the infrastructure sector, it’s a buy at these levels."

Link to article: http://www.moneycontrol.com/india/news/stocks-views/buy-jaiprakash-associates-says-mehta/16/23/327508

Jaiprakash - Update - SAIL to form JV with Jaiprakash Associates

Steel Authority of India Ltd (SAIL) has announced that the Company on February 21, 2008 has signed a Joint Venture Agreement with M/s. Jaiprakash Associates Limited (JAL) for formation of a Joint Venture Company (JVC) to set up a cement plant for producing 2 million tonnes of Cement at Bokaro (Jharkhand) by using slag generated at Bokaro Steel Plant of SAIL. SAIL would hold minority stake of 26 per cent in the JVC and the remaining 74 per cent stake would be with JAL.


Link to the article: http://www.equitybulls.com/admin/news2006/news_det.asp?id=25758

Jaiprakash - Update - Buy Jaiprakash Associates: Joshi

Sharmila Joshi, Head-Institutional Sales, Prabhudas Lilladher is of the view that one can buy Jaiprakash Associates.

Joshi told CNBC-TV18, "We have seen a sell-off in Jaiprakash Associates in the last week. But given the kind of price you find it at and given the kind of projects to my mind at Rs 250 is a good price to buy. If you give six month to a one-year horizon then from here you will see good gains in the stock."

Link to the article: http://www.moneycontrol.com/india/news/stocks-views/buy-jaiprakash-associates:-joshi/327218

Jaiprakash - Update - Jaiprakash Associates looks attractive: Mukadam

Shahina Mukadam, IDBI Capital Market is of the view that Jaiprakash Associates is looking attractive at current level.

Mukadam told CNBC-TV18, "Fundamentally at current levels, Jaiprakash Associates is looking extremely attractive. There are couples of things that are good for the longer-term growth and valuation for the company. They have got the Taj Expressway project, which is a very large project and as part of that project, they will get to develop close to 6,250 acres of land, 5 points across this highway that joins Agra and Noida. This is not there in the valuation as of now currently, it is not reflected and but it is something that will evolve over a period of time. Even if you exclude this I think the existing business of the company there is a lot of growth momentum. As of now they have just 7 million tonnes of cement capacity which I believe is going to double in the next 12 months to 14 million tonnes."

She further added, "If you look at on EV to price per tonne it is very interestingly placed especially if you take an SOTP value assigning some value to the land on the proposed Agra Highway. In addition to this of course the EPC work that the company is doing, they have got lot of projects another Rs 2,500 crore is expected to come in revenues from this project next year and also it is in a much complex area, the EPC contracts is in the Hydro power area, which definitely offers better scope of margins. All in all valuations are not stretched at around Rs 30 EPS with the current price level. I think it is extremely and attractively priced."

Link to the article: http://www.moneycontrol.com/india/news/stocks-views/jaiprakash-associates-looks-attractive:-mukadam/327247

IVRCL - Update - Wins new projects

IVRCL Infrastructures & Projects Ltd has announced that the Water, Irrigation and Power Divisions of IVRCL have bagged orders of the value of Rs 517.89 Crores as detailed hereunder: - Scope of Work * WATER DIVISION: 1. Providing Infrastructural facilities to Pedagantyada, Gangavaram, Bhonojithota, TGR Nagar, Sebastian Colony, Chakiravukonda, Shiva Sakthi Nagar, Siddartha Nagar, AK & AS Colony, Aganampudi (UPH) and Rasalamma Colony Poor Settlement in GVMC under JNNURM. - Client : Greater Visakhapatnam, Municipal Corporation, Visakhapatnam - Value: Rs 91.88 Crores 2. Renovation & Augmentation of Deoghar Water Supply Scheme - Client : Deoghar Water Supply Department, Jharkhand - Value: Rs 49.56 Crores 3. Chhapi-Jalawar-Jalarpatam Water Supply Project (KT-04/2006-07) - Client : Public Health Engineering Department, Kota - Value: Rs 46.43 Crores 4. Design and construction of Water Treatment Plants, Storage ESR, Sumps, Staff Quarters, Constructing Pump House, Chlorination Plant, Boundary Wall. Providing, Lowering, Laying, and jointing pipeline - Client : Gujarat Water Supply and Sewerage Board - Value: Rs 42.06 Crores 5. Investigation, Surveying, design, preparation of detailed estimates and execution of comprehensive storm water drainage scheme for Anakapalle municipality - Client : Public Health Engineering Department, Visakhapatnam - Value: Rs 28.78 Crores 6. Providing flow, Level and Chlorine Measurements and Supervisory Control and Data Acquisition (SCADA) System for All Reservoirs and hulk supply pipelines in the entire system of HMWSSB on EPC System - Client : Hyderabad Metropolitan Water Supply & Sewerage Board - Value: Rs 10.46 Crores 7. Other Miscellaneous Works - Value: Rs 12.14 Crores * IRRIGATION DIVISION 8. RTTP Stage -II- Design, Supply and Execution of Mild Steel Raw Water Supply Pipeline to carry 40 Cusecs of Water including construction of Pipe Bridges across Rivers and Canals from Sri Pothuluri Veerabrahmendra Swamy Reservoir to Rayalaseema Thermal Power Project including construction of Storage Reservoir in Plant Premises at V V Reddy Nagar, Kadapa District, A.P (Package-I). - Client : Andhra Pradesh Power Generation Corporation Ltd (APGENCO), Vidyut Soudha HYDERABAD - Value: Rs 139.49 Crores * POWER DIVISION: 9. Works relating to transmission lines, substations under RGGVY Scheme in Ukrhul District of Manipur (Package -A) and under APDRP Scheme in Churachandpur District. ( Package-B, C & D), Thoubal District (Package-B, C & D) - Client : Electricity Department of Government of Manipur - Value: Rs 42.33 Crores 10. Construction of Transmission lines on Turn basis and supply of equipments for construction of grid substations - Client : Bihar State Electricity Board, Patna - Value: Rs 29.66 Crores 11. Diversion of 400KV D/C Chandrapur Parli Line due to proposed open east mines of M/s. WCL at Pimpalgaon, Telwasa and Dhorwasa - Client : Maharashtra State Electricity Transmission Company Ltd, Mumbai - Value: Rs 15.72 Crores 12. OHE Works between Kayankulam and Hanipad of Southern Railway in Kerala State on Turnkey basis - Client : Southern Railway - Chennai (Tamilnadu) - Value: Rs 9.38 Crores.

Jaiprakash - Update - Finquest bullish on JP Associates

Q: JP Associates has been hammered out of shape over the past few days. Would you initiate a buy call or is there still some pain left in the stock?

A: General investors would look at buying at these levels because a lot of concerns were overplayed on the 45% stake sale buzz. Post that, we need to take consolation from the management. They have given a pure clarification that such a move will not be initiated.

So, a lot of selling is appearing under counter. But for those with a perspective of 6-12 months, it makes good sense to buy at this level. We were seeing a lot of embedded value where things could get postponed. But with respect to the management saying they are going ahead with their power IPO, that is now in place. The only thing is that the valuation has got de-rated for the entire power sector. So to that extent, we could see lesser embedded value could be unlocked from there.

The stock has corrected almost 50% from the peak. It makes sense for a long-term investor. Other than the construction story, everything is in place. We are not seeing any concern on that front. It is more of a sentimental play. So, as selling pressure gets receded, the stocks could start performing.



Link to the article: http://www.moneycontrol.com/india/news/market-outlook/finquest-bullishjp-associates-jk-b/21/09/327126

Wockhardt - Update - Sales to grow by over 20% in 2008: Wockhardt

Wockhardt has announced its fourth quarter results. The company’s Q4 consolidated net sales were up at Rs 762 crore (Rs 7.62 billion) versus Rs 526.40 crore (Rs 5.26 billion). Its consolidated net profit was up at Rs 106.90 crore (Rs 1.06 billion) from Rs 87.10 crore (Rs 871 million).

Habil F Khorakiwala, Chairman of Wockhardt said that he feels that Wockhardt’s EBIDTA margin of 24% is sustainable, going forward. He expects sales to grow by over 20% in 2008, he told CNBC-TV18. Khorakiwala is disappointed about the IPO withdrawal and is looking at ways to raise funds. Wockhardt will hold an EGM shortly to decide on the future of their R&D arm, he added.

Excerpts from CNBC-TV18’s exclusive interview with Habil F Khorakiwala:

Q: Give us one word on the EBITDA performance you have had this quarter whether that can be sustained and what happened in terms of sales from Cetrizine in specific?

A: I think the kind of EBITDA you see today is something, which is sustainable at about more than 24%. In fact for the whole year EBITDA increased by about 100 bps. This is in spite of the fact that we acquired new companies Negma and Montenegro and Pinewood and all of them had much lower EBITDA. So this is what it reflects; is really a turnaround we have been able to do very quickly in 2007 - more offers will definitely come in 2008.

As far as Cetrizine is concerned, we would be in the market - we are manufacturing it against specific orders and we would be supplying in the US market sometime in March-April period.

Q: In that light what is the outlook that you can offer investors for the next coming few quarters particularly in terms of consolidation of the new entities or the acquisitions you have made?

A: Q4 practically reflects the activities of our entire organization including all new acquisitions and for last three consecutive quarters, we have shown a net profit of more than 100 crore. I am sure the level of growth one would see in net profit would continue more or less at the same level of 14%-15% on total gross sales.

We expect sales to continue to grow at around more than 20% during 2008.

Q: What is the plan now for Wockhardt Hospitals as also for your R&D arm and are you disappointed about the way things went about in the past fortnight?

A: Yes, certainly we are disappointed about our Wockhardt Hospitals; somehow we have got sucked into a storm when the market fluctuation was there and we decided to withdraw it in the long-term interest of all investors and the company.

Our future plan is that we are in a process of reviewing the options available to us. So we have not taken a view yet on it probably I think we will take a view in next two-four weeks.

We are just meeting in the EGM to take a view on R&D. So R&D demerger will achieve a few purposes. It will have the drug discovery portfolio and innovative patented technologies which takes three-four years and what we will achieve is with the innovative technology, the profits and revenue will start flowing in next three-four years whereas a drug discovery will take a little longer time and we are also looking for outlicensing. We thought we can really forecast on developing research - R&D approach. We believe that there are great opportunities in the R&D space.

Link to article: http://indiaearnings.moneycontrol.com/sub_india/compnews.php?autono=327086

Wockhardt - Update - Results

Wockhardt Q4 net profit up at Rs 106.90 cr

Wockhardt has announced its fourth quarter results. The company’s Q4 consolidated net sales were up at Rs 762 crore (Rs 7.62 billion) versus Rs 526.40 crore (Rs 5.26 billion) Its consolidated net profit was up at Rs 106.90 crore (Rs 1.06 billion) from Rs 87.10 crore (Rs 871 million) Result (Rs cr) Dec-07 Sep-07 Jun-07 Mar-06 Net Sales / Interest Earned / Operating Income 1237 1135 963 847 Other Income 11 22 21 17 Total Income 1248 1156 984 864 Expenditure -959 -840 -693 -617 Operating Profit 288 317 292 247 Interest 19 31 -2 12 Profit Before Depreciation and Tax 308 348 290 259 Depreciation -35 -35 -24 -18 Profit before Tax 273 313 265 240 Tax -59 -39 -27 -33 Profit after Tax 214 274 239 208 Extraordinary Items - -60 - - Net Profit 213.90 213.50 238.50 207.80 Equity Capital 54.70 54.70 54.60 54.50

Link to article: http://indiaearnings.moneycontrol.com/sub_india/compnews.php?autono=327054

Wockhardt - Update - Annual Results

Wockhardt’s Robust Annual Results

Sales surge by 53% to Rs. 2,653 crore Net Profit soars by 60% to Rs. 386 crore Operating Margin at 24.1% up 90 basis points

Mumbai, 20 Feb,2008

Pharmaceutical and biotechnology major Wockhardt Limited today announced its results for the year ended 31st December 2007. Sales revenues surged by 53% to Rs. 2,653 crore, net profits soared by 60% to Rs. 386 crore and operating margins at 24.1% improved by 100 basis points.

“In 2007 Wockhardt moved into another trajectory of globalisation and growth. Not only did sales grow by 53%, operating profit margins improved 90 basis points resulting in 60% improvement in net profit,” said Wockhardt Chairman Habil Khorakiwala. “The value creation in the new acquisitions of Pinewood and Negma in Europe, contributed to the growth in profits.” Elaborating further on Wockhardt’s strategic plans for the future, Chairman Habil Khorakiwala said, “We are fundamentally focussed at consolidating, integrating, rationalising and optimising our global resources to create value for the company and all our stakeholders.” For the fourth quarter of 2007, net profits climbed to Rs. 107 crore, thereby crossing the 100 crore mark for the third consecutive quarter. Sales peaked at 45% to Rs. 762 crore and operating margin at 24.9% improved by 170 basis points. The total dividend for the financial year ended December 31, 2007 is Rs. 11.25 per equity share i.e. 225%. An interim dividend of Rs.8.75 per equity share i.e. 175% was paid in November 2007. The Board has now recommended an additional dividend of Rs. 2.50 per equity share, i.e. 50%. On the India business front there has been a strategic thrust with Wockhardt signing in-licensing agreements with 6 European and US companies for 11 products, of which 5 products have already been launched in the country in the field of Dermatology, Nutraceuticals and Osteo-arthritis. India Business: As per ORG-IMS, the domestic business recorded an annual growth of 19% vis-à-vis 13% industry growth rate. Dexolac joins Spasmo-Proxyvon in the elite ‘Top 100’ brands in India. Overall 8 brands feature in the list of ‘Top 300’ brands of the industry (ORG-IMS Dec 2007). Europe Business: UK, Ireland, Germany and France recorded double-digit growth, almost twice the industry growth in these markets. The European formulation business grew 97% FTY 2007. Wockhardt UK also saw an opportunity and launched the NRT (Nicotine Replacement Therapy) in patches and lozenges forms for curbing smoker’s habit. US Business: With the Morton Grove acquisition, Wockhardt now has a complete range of dosage forms from tablets, capsules, liquids and injectibles. Morton Grove has a portfolio of 31 products, 13 of which occupy the No.1 market position. All others are in the Top 3. The overall product range has now swelled to around 56 products for the US market, of which Wockhardt USA Inc is currently marketing 25 products. The US FDA also approved 13 ANDA’s, of which 11 products have already been launched Wockhardt Limited is a global pharmaceutical and biotechnology major with an innovative research and development programme. Wockhardt has global footprints including UK, France, Germany, Ireland and USA. Wockhardt employs around 6000 people worldwide belonging to 14 different nationalities.



Link to the article: http://www.wockhardtin.com/press_releases/3rd_quarter.php?$id=225